Arizona Tax
For Arizona residents, you specify the employee's exemptions.
Deltek Modification Date - 12/19/22
The Arizona state tax is based on a percentage of the taxable wage. Employees subject to the Arizona state tax must indicate whether they want the state to withhold 0%, 0.5%, 1.0%, 1.5%, 2.0%, 2.5%, 3.0%, or 3.5% of the taxable wage.
Enter the following information on the Withholding grid on the Payroll tab of the Employees hub:
Field | Description |
---|---|
Status | Arizona’s tax calculations do not use the Status field. |
Exemptions |
Enter the percentage of taxable wage desired by the employee, as indicated on Arizona Employee Withholding Certificate, Form A-4. Options are:
Vantagepoint does not check this field. Any number other than 0, 1, 2, 3, 4, 5, 6 or 7 will be recognized as 0%. Select a filing status of Both if the employee has chosen an Arizona withholding rate of 1.8% on their Arizona Withholding Percentage Election (A-4) form. If the employee did not submit Form A-4, enter 0 in this field. |
Other Exemptions | Arizona’s tax calculations do not use the Other Exemptions field. |
How Vantagepoint Calculates Tax
To calculate an employee's Arizona State tax, Vantagepoint does the following:
- Multiplies the employee's gross pay per pay period by the number of pay periods in a year to determine annualized gross wages.
- Subtracts the employee's 401(k) and 125/Cafeteria plan contributions from the employee's annualized gross wages to determine taxable income.
- Applies the percentage indicated by the employee to the taxable wage, yielding the net income tax for Arizona.
- Divides the annual income tax by the number of pay periods in a year to determine the amount to be withheld for the pay period.